NEW YORK (CNNfn) - Tyson Foods Inc. announced Wednesday that it will terminate its cash tender offer for 50.1 percent of IBP Inc., but will try to acquire the company through other means.

Tyson will not meet the deadline for its cash tender offer of Dakota Dunes, S.D.-based IBP (IBP: Research, Estimates). The purchase will expire at midnight, ET, when Wednesday expires and Thursday, March 1, begins. Tyson's pursuit of a cash merger would delay the proposed transaction as Tyson would have to file a prospectus and proxy statement with the Securities and Exchange Commission, that would include IBP's restated financials, the company said in a statement.

"Unfortunately, it will be impossible to complete the cash tender offer by the 28th," said John Tyson, company chairman and CEO, in a statement. "IBP continues to work with the SEC to resolve their accounting issues. After that work is complete, we will determine what effect these matters will have on our deal."

Tyson said it will now pursue a cash election merger, where IBP investors can chose cash or Tyson stock for their shares.

Both Tyson and IBP could not be reached for comment.

The deal

On Jan. 1, Springdale, Ark.-based Tyson (TSN: Research, Estimates), the largest U.S. chicken producer, won the bidding war against Smithfield Foods (SFD: Research, Estimates), the No. 1 U.S. pork processor, for IBP. Terms of the merger agreement call for Tyson to pay $30 per share cash for 50.1 percent of IBP's outstanding shares and the equivalent of $30 per share in stock for the remaining stake. Tyson will also assume $1.5 billion in IBP debt, up slightly from its original projection of $1.4 billion.

Tyson's $3.1 billion cash and stock offer originally expired on Jan. 16 and was then extended to Jan. 24. In late January, Tyson extended its cash offer to IBP shareholders until Feb. 7 after learning that the Securities and

Exchange Commission would review IBP's financial records. IBP officials at the time did not reveal specific details of the SEC's inquiry but said the questions involved previous account filings and acquisitions by IBP.

The Jan. 1 deal was eventually extended to Wednesday, and includes language that the purchase would revert to a cash election merger if the initial cash offer was not complete by the Wednesday deadline.

The SEC is currently investigating IBP for accounting practices. Last week, IBP said it would take a one time charge of up to $108 million related to its acquisition of DFG, a Chicago-based hors d'oeuvres and appetizer maker it bought in 1998, and may take additional charges due to the SEC investigation.

However, IBP reaffirmed it commitment to the Tyson purchase Wednesday. The process for completing the merger will change but the base terms of the agreement will not, IBP said in a statement.

"IBP continues to work diligently to resolve issues raised by the Securities and Exchange Commission," the company said. "We are pleased to report we continue to make significant process and hope the matter can be completed soon."

Shares for IBP fell $1.03 to $26.27 in afternoon trading Wednesday, while Tyson dropped 50 cents to $12.30 and Smithfield declined by 7 cents to $29.51.